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It is hard to understand how Federal Reserve Bank of Dallas President Richard Fisher can say the U.S. economy is overstimulated when first-quarter gross domestic product growth might have been as feeble as 1.5%, according to The Economist. "This is why it's a problem to be obsessively cutting short-term government spending," the magazine noted. "And this is why it's a problem when regional Fed presidents start recommending that the Fed end QE2 early."

Related Summaries

JPMorgan beat the Federal Reserve in announcing the results of its stress test Tuesday afternoon, angering other banks that said they followed the Fed's instructions to stay quiet until the report was released after the close of markets. Fed officials say JPMorgan wasn't at fault. They said JPMorgan's early release was the result of miscommunication between the Fed and the bank.

Given the feeble economic recovery, an explicit inflation-rate target announced by the Federal Reserve sends a clear signal that the central bank is nearing another round of stimulus, according to The Economist. "With unemployment too high and inflation still weak, more monetary stimulus is easily justified," the magazine says. Fed Chairman Ben Bernanke "left the door open to that option. The odds are that he will walk through it."

Prospects for the U.S. economy are growing dim amid continued weakness in two key components of household wealth -- housing and stock values. The Federal Reserve is expected to take action to attempt to revive the market, but some investors are skeptical of its ability to restore confidence. "This doesn't paint a pretty picture for household net worth and it worsens the outlook for consumer spending," Moody's Analytics chief economist John Lonski said.

It is hard to understand how Federal Reserve Bank of Dallas President Richard Fisher can say the U.S. economy is overstimulated when first-quarter gross domestic product growth might have been as feeble as 1.5%, according to The Economist. "This is why it's a problem to be obsessively cutting short-term government spending," the magazine noted. "And this is why it's a problem when regional Fed presidents start recommending that the Fed end QE2 early."

It is hard to understand how Federal Reserve Bank of Dallas President Richard Fisher can say the U.S. economy is overstimulated when first-quarter gross domestic product growth might have been as feeble as 1.5%, according to The Economist. "This is why it's a problem to be obsessively cutting short-term government spending," the magazine noted. "And this is why it's a problem when regional Fed presidents start recommending that the Fed end QE2 early."